The invention overcomes the deficiencies of the prior art by providing a rapid approach for isolating binding proteins capable of binding small molecules and peptides. In the technique, libraries of candidate binding proteins, such as
antibody sequences, may be expressed in the periplasm of
gram negative
bacteria with at least one target ligand. In clones expressing recombinant polypeptides with affinity for the ligand, the ligand becomes bound and retained by the
cell even after removal of the outer membrane, allowing the
cell to be isolated from cells not expressing a binding polypeptide with affinity for the target ligand. The target ligand may be detected in numerous ways, including use of direct
fluorescence or secondary antibodies that are fluorescently labeled, allowing use of efficient
screening techniques such as
fluorescence activated
cell sorting (FACS). The approach is more rapid and robust than prior art methods and avoids problems associated with the outer surface-expression of ligand fusion proteins employed with
phage display.